Question

Suppose that the Board of Directors of the local company proposes that price of one of their
competitive product in the market be raised as a means of raising additional funds to support
flood victims. Explain in support what the members are implicitly assuming about the price
elasticity of demand of the product.

Answer 1

Answer:

Economics is defined less by the subjects economists investigate than by ... It appears that the cost of our use of oil may be rising. ... 50 support at least one child over the age of 21.

Answer 2

A. less than unity

Explanation:

• Price "elasticity of demand" is the extent  to which the "effectual desire" for "something changes" as its "price changes". In general, people "desire" things less as those things "become more expensive".
• Price "elasticity of demand" can be greater than unity, unity, zero, infinite, or,  less than unity
• If, the "change in demand" is less than proportionate to the "change in price", "price elasticity" of demand is "less than unity", for example, When a 20% change in price results in 10% demand change, then EP=10%/20%=1/2=<1, i.e. Δq/Δp < 1.

To know more

the price elasticity of demand of x is -1.25 . it's price fall from rs 10 to ...

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